Paraguay renews special loan scheme for vehicle, machinery buyers

Authorities in Paraguay renewed a special loan program designed to spur the sale of new vehicles and machinery.

Branded Vehículo 0km para la gente, the scheme was launched (pictured) by the industry and trade ministry, development bank BNF and car and machinery distributor association Cadam.

Financing, provided via BNF, comes with better terms than that offered in the local financial market, state news agency IP reported.

Companies or individuals can apply for loans of up to 4bn guaraníes (US$568,436) for construction, farming and industrial machinery. The lender is offering repayment periods of up to seven years, grace periods of up to two years and an interest rate of 8.5%.

Prospective vehicle buyers are being offered loans of up to five years at a rate of 8.95% (for vehicles priced up to 100mn guaraníes) and 9.95% (for those priced 100mn-150mn guaraníes).

Borrowers are required to take out comprehensive insurance, according to information on the BNF website.

The Vehículo 0km para la gente scheme has now been renewed twice. 

In September, multilateral development bank Fonplata – established by Argentina, Bolivia, Brazil, Paraguay and Uruguay to support development in the River Plate basin – awarded BNF a US$36mn revolving loan facility for post-pandemic economic reactivation. The loan will be used for funding SMEs that are part of the export value chain, Fonplata said at the time.